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Home Publications Blogs Beat the Press Matt Miller Celebrates the Stinking Corpse of Americans Elect

Matt Miller Celebrates the Stinking Corpse of Americans Elect

Friday, 18 May 2012 04:54

Matt Miller is the perfect embodiment of the Washington punditry. In his weekly column in the Washington Post he complains about being a victim of the "False Equivalency Police." These would be the people who point out that many of the assertions that he and other professional centrists make about the Democratic and Republican parties being taken over by extremists are not true.

It is only the Republican Party that has moved to the extreme right, the Democratic Party has actually moved towards the center. Apparently the people who have the gall to call attention to this fact and undermine the story of the professional centrists, have sufficiently angered Miller that he now thinks of them as a type of police force. Life is tough for WAPO columnists.

I will always have fond memories of Matt Miller as the one person who left me completely speechless in a debate. The year was 1996 or 1997. Miller and I were on a public radio show debating the proposal, which was then popular in Washington, of reducing the annual cost of living adjustment for Social Security by roughly 1 percentage point.

Their argument was that the consumer price index (CPI), which is the basis of the indexation, overstated the true rate of increase in the cost of living. I was pointing out that the evidence for this claim was actually quite weak. Furthermore, such cuts would be a substantial hit to an elderly population that was already not doing very well.

One of the other guests on the show was Wyoming Senator Alan Simpson. In his usual tactful way, Simpson went on a tirade saying that the estimate that the CPI overstated inflation by 1.0 percentage point was way low. He said that it was more like 1.5 percentage points and that he has economists who say that it is more than 2.0 percentage points. He concluded by saying that pretty soon our grandchildren will all be living in chicken coops.

When I got a chance to respond I pointed out that Senator Simpson had it exactly backwards. The greater the overstatement in the CPI, the richer our children will be.

The logic here is straightforward. We know the rate of nominal wage growth, let's say it's 3.0 percent annually (this was the 90s). If the CPI tells us that the inflation rate is 2.0 percent, then the rate of real wage growth is 1.0 percent annually (3.0 percent - 2.0 percent = 1.0 percent).

Suppose that the CPI overstates the true rate of inflation by 1.0 percentage point so that the true rate of inflation is just 1.0 percent. Then the annual rate of real wage growth is 2.0 percent (3 percent - 1.0 percent = 2.0 percent). If Senator Simpson's economists were right and the overstatement was 2.0 percentage points, then real wages were growing at the rate of 3.0 percent annually (3.0 percent - 0.0 percent = 3.0 percent).

I pointed out that if Simpson was right about the CPI hugely overstating inflation, then our children and grandchildren would be incredibly rich. If real wages rise by 3.0 percent a year, then in 30 years they will be more than 140 percent higher. Therefore there was no reason to be so concerned cutting Social Security benefits for today's elderly, most of whom would have grown up in poverty using the Simpson CPI.

Miller then responded by saying something to the effect that, "Dean thinks it's okay to tax our children because they will be rich." Yes, he had me stumped. I had no good response to that one. 

Anyhow, back to the stinking corpse of Americans Elect. Americans Elect was supposed to be a third party that was set up by a group of rich hedge fund types to counter the growing extremism of the two parties. While it had huge support from people like Thomas Friedman and Matt Miller, no one apart from the elite punditry types took it seriously This week they announced that they were folding the tent.

This outcome naturally left Miller disappointed. He still needs someone to embrace his ambitious agenda which includes such things as cutting Social Security and Medicare. He asks:

"If you think we should not guarantee the next generation of retirees a 30 percent real increase in initial Social Security benefits (as we do today) before we’ve first guaranteed that every child in America has access to high-quality pre-schools and great teachers (in part by recruiting top college students to careers in the classroom and paying them up to $150,000 a year), which party represents your voice?"

Of course many of us answer that we should be guaranteeing every child access to high-quality pre-schools and great teachers, but this has nothing to do with the first part of Miller's sentence. Since workers pay for their Social Security benefits with a designated tax, his sentence makes no more sense than saying we should not pay interest on the government bonds held by wealthy people like Peter Peterson before guaranteeing decent education for our kids. Those of us familiar with the projections know that there is no reason that we cannot do both.

He then concludes his piece with a direct attack on the False Equivalency Police, saying that:

"So far as I can tell, others in the False Equivalency Police have offered few ideas on how to broaden the debate to meet the country’s challenges, beyond vanquishing the GOP. That’s their prerogative as a political matter, of course, but it won’t (again, in my view) come close to rebuilding upward mobility and economic security in the United States. I’m not sure what Paul Krugman thinks a plausible path to a much more ambitious agenda is, but I’d be curious to hear it."

Of course Krugman and others of us who would qualify as card carrying members of the FEP have offered endless suggestions on how we can have a more prosperous equitable future. While most of the FEP, unlike Miller, may not have the benefit of a weekly column in the Washington Post to advertise our views, they are available on the web. Of course Krugman's writing are highly visible, if Miller is actually interested in finding out what his nemeses on the left have to say.

If Miller doesn't know our agenda then it is due to his decision to remain ignorant. That's his right, but he shouldn't blame the left for his own determined ignorance.

Comments (17)Add Comment
written by David, May 18, 2012 7:38
I would LOVE for Matt Miller to go to a pre-school (bonus for high-quality) and get hisself some edumacation. The mind of a child, the body of a man, a pulpit in a major newspaper: another failure of the "free" market.
written by coberly, May 18, 2012 8:38

you missed an opportunity to tell Miller and Simpson and the world that the huge tax they are worried about burdening today's youth with amounts to forty cents per week.
(CBO Option 2).

I know you know this, and it is implicit in your replies to them, but the people can no more "derive" that result than they can understand what you said about the inflation rate.

sometimes being too much smarter than your opponents is a handicap.
written by coberly, May 18, 2012 9:30
another way you could have made the point is that since the workers are paying for their own benefits, it doesn't matter what the inflation rate "reall" is. the workers can decide to fund their own retirement at whatever level of benefit seems to them a reasonable balance between what they want "now" and what they will want "then."

so instead of worrying about which inflation rate is "real", they could just say," you say the inflation rate is 1%, fine, i think we will raise benefits 2% each year," or peg benefits to wages... just the way "initial benefits" are wage indexed. or some other number.

part of the "calculation" of what is reasonable might indeed include the various estimates of inflation, but they might also include a shrewd estimate of whether the "cost of living" is greater or less as you get older...

point is there is no reason to privilege "inflation" as somehow the holy number to base benefit increases from year to year. perhaps old folks should share in the general rise in standard of living and not be held to, say, living without a computer because computers were not as essential to living standards when they retired as they have become since.

of course the key to all this is remembering that workers pay for their own benefits. something that seems hard for either side of the "debate" to hold in their minds.
related issue
written by coberly, May 18, 2012 10:41
part of the problem here is that the bad guys sneaked in the idea that Social Security needed to be fixed "forever." Andy Biggs is quite sure that having to go back and "fix it again" from time to time would be an intolerable burden. As I suppose it would be if Peterson had to spend a Billion dollars every decade or so to to try to "fix" it for good.

But we don't seem to think that the price of bread, or automobiles, or the interest rate or the returns on stocks need to be remain constant forever.. or even for seventy five years. These things are allowed to change. But somehow Social Security must be "solved" at once forever.

No reason we can't go back and visit the tax rate or benefit rate every few years and see how they are doing relative to the needs of workers and retirees. Especially if, as looks like, a "ten year fix" can be had for a change in the tax rate that is so tiny no one would even notice it... if Peterson wasn't lying about it... and an adjustment in the benefit rate could be made to reflect the actual experiences of retired people, again with an adjustment of the tax rate too small to notice.

This might require a slight difference in attitude... and that's all it is... between workers paying for their own retirement, which is what they do, though folks can't seem to understand pay as you go, and workers paying to maintain a "program" that they will need, badly, in their turn when the time comes.

suppose your old father had a really, really nice house that you expect to inherit, but needs some maintenance from time to time that dad can no longer afford to do. would you spend the money to help him out, knowing that in the long run you would be helping yourself out, or would you just say, "dad, that's YOUR problem."

the bad guys want us to think like that: "hell, we are not in this together, it's all about ME and what I can get NOW. Social Security is not a program to insure against poverty in old age. It's really an investment program, and that means we have to watch very carefully to make sure we get as much as the other guy got."

You know, just like the stock market.
fixing Social Security
written by coberly, May 18, 2012 10:48
based on present Trustees projections, Social Security could be fixed with a one tenth of one percent increase in the payroll tax on each the employer and employee each year beginning in about 2026 and ending... or at least decreasing in frequency after about 2036... expecting to further adjust the tax rate by one tenth of a percent at a time according to Trustees Projections of SHORT TERM actuarial solvency... meaning does a ten year projection show at least a one year's full operating reserve.

but this would be too easy. the bad guys want to kill SS or cut it below a level where it provides meaningful retirement insurance. and the good guys want to kill SS by turning it into welfare to solve all the injustices in the world.

the idea that it is just a way for workers to save their own money for their own retirement, protected from inflation by pay as you go financing... is just too damn hard for them to understand. as is the fact that it works to prevent poverty better than any welfare program ever invented.
written by kharris, May 18, 2012 11:44
When people break the law, they aren't wild about people who enforce the law. When people break the truth, they aren't all that happy with people who insist on telling the truth. Those who engage in false equivalency...well, you get the idea.

Miller's "love to hear it" comment is prima facia evidence that he's a truth breaker, just as his failed (failed!, Failed! FAILED!) organization is evidence of his engagement in false equivalence.

great teachers
written by coberly, May 18, 2012 11:59
it may be worth pointing out that "fixing our schools" is one of the perennial big lies of politics. maybe some schools need to be fixed literally. but the sad fact is that you are NOT going to raise the "achievement" of kids by finding a "great teacher" for every classroom

they know this but its a good way for them to get the "our poor kids" factor into the debate... knowing that old folks in fact are suckers for it and will live on tea and catfood if they believe it will "help the kids."

and add to it the fact that the republicans, mostly, are determined to cut wages for schoolteachers in every state in the country.

and that schoolteachers get old and retire too.
written by David S., May 18, 2012 12:33

You are absolutely correct in your critique of self-proclaimed "centrists" like Matt Miller and Tom Fiedman. As you note, the modern Democratic Party under President Obama is that centrist party.

However, I think there may be something to this "third way" idea, because Republicans ultimately will be successful in some future election cycle in blaming the "liberal Democratic Party" for whatever misfortune strikes the country while Democrats hold power -- a terrorist attack, a financial meltdown, whatever. The 10% or so of the electorate who swing elections -- low information voters (to be charitable) -- will fall yet again for conservative nonsense.

Only then will a third party need to "re-brand" Democratic party programs as "centrist," in the same way that "liberal" politicians now feel compelled to re-brand themselves as "progressives."

To avoid splitting the vote in such a context and thus handing the victory to the Republicans, the key would be for the "centrists" to announce their policy proposals and for the Democrats to embrace them. Since these proposals presumably would include increased taxes on the wealthy, Republicans would not adopt them.
written by coberly, May 18, 2012 1:07
good lord, David, there is nothing "centrist" about the democrats at all except for rhetoric: a pious appeal to remember the poor poor (anyone making less than 250k apparently).

rather than let the poor workers pay an extra forty cents per week to preserve Social Security, they would prefer to cut benefits, raise the retirement age, or means test... so that Social Security becomes welfare and ceases to provide meaningful retirement insurance for ordinary workers.

this is just the Republican plan to destroy Social Security under the rhetorical flag of being "the workers party" while screwing the workers.

When Nancy Pelosi says she would vote for Simpson Bowles.. a "plan" that blames Social Security for the deficit and proposes cutting benefits below survival levels.. you ought to know that the Dems are not on your side.

One more time: Social Security has not a damn thing to do with the deficit. And the workers can pay for their own Social Security forever as they always have. To keep the same "replacement rate" over a longer life expectancy (and some changes in the economy) current workers... future retirees... would need to raise their own payroll tax forty cents per week each year.

That's all it would take. But you won't hear it from the R's for sure, or the D's, or shameful to say, the "progressives."
written by Union Member, May 18, 2012 1:10

Simpson, Friedman, and Miller grew up in a chicken-hawk coop.
1. the repubs & the demos 2. our schools
written by mel in oregon, May 18, 2012 2:38
mussolini commenting on fascism said, "fascism wants to reduce the size of the state to its necessary functions." hum, wonder if that's where grover norquist got his ideas on reducing government? the modern republican party has many of the characteristics of fascism such as a desire for a permanent war economy, the imprisonment of huge numbers of our citizens, with a large proponderance of blacks & latinos in the facilities, the destruction of many small nations that have resources we covet, & a growing police state to stamp out any dissent such as the occupy movement. the democrats, certainly not centrist by any means. they are way over on the right too, just slightly less leaning toward fascism than the repubs. basically in spite of the nonsense you are taught in school, your church or listening to fox noise, we have always been not too far away from fascism. 300 million black slaves, genocide of native ameicans, indentured servitude, voting denied to everyone except white, male property owners. lets don't pretend either party has any interest in anyone that isn't rich here in america, or any people's outside america if they have oil, or another precious resource. 2. schools. the main item should be an equitable distribution of resources. poor schools are over crowded, kids that are hungry & tired (hard to sleep if police sirens are blaring all night in the ghetto or bario), paint falling on your head from the ceiling, & in a lot of them you carry your own toilet paper. well off schools? the best computers & visual aides, tennis courts, swimming pools, small class sizes, & far better food in the cafeterias. don't pretend these factors don't have a great affect on learning.
to union member
written by coberly, May 18, 2012 2:50
i don't pretend. i am all for better schools. but i don't think "we" should fool ourselves that "great teachers" are going to make all of us above average children into doctors and lawyers.

and of course it's all a lie anyway when R's pretend there is some trade off between better schools and social security. there is not. workers pay for their own social security. so if you tax the workers forty cents per week less than it costs to give them an indoor retirement, are you going to tax them forty cents per week more in order to make the schools "better" while the R's are cutting teachers pay and pensions with the other hand?
Study says CPI UNDERSTATES retiree costs
written by jumpinjezebel, May 18, 2012 3:02
I've seen a report that says due to the buying habits and needs of the elderly that the CPI understates inflaction in the things they buy and consume. (Health Care, drugs, Insurance, etc.)
"centrist" vs. centrist
written by whispers, May 18, 2012 3:27
coberly is correct to point out the our Democratic party isn't centrist. But David S. is correct to say that they are "centrist". Today's "centrists" are in the center of nothing other than their own narcissism. The bulk of the voting public, in both parties, wants to see Social Security preserved. The constituency that wants to see benefits cut and/or see the program privatized is entirely comprised of investment bankers and their minions. They all view the public retirement fund to be a massive source of lost potential money for them to play with.
Sadly, these people won't ever shut up. You would think that after seeing this idea shot dime time and time again, even when the GOP controlled all three branches of government, would be enough for the privatizers to take their ball and go home. But they have no incentive to do so. They are never going to give up.
But we needn't act like they are the center of anything.
I thought...
written by Carl Weetabix, May 18, 2012 4:15
From what I can see "centrists" are just another kind of partisan, just instead for the "center". That is, they are just as dogmatic as the left or the right when it comes to supporting their "centrist" views. They also are clearly just as shrill (ie: assholes).

It's another religion, but it's still just a religion.
Also on education...
written by Alex Blaze, May 18, 2012 5:48
Miller's wrong about teachers. Centrists love the "Fire union teachers and replace them with college grads from Harvard" idea, but it doesn't work. It turns out (I know this is shocking) that teachers with less experience are worse that their jobs! Also, getting teachers who see the job as a starter career who are planning to leave in a year or two doesn't develop that workforce. The data doesn't support this as a good idea.

But centrists love it because they hate teachers. It's probably because of all the bad grades they got from those elitists who thought they were in charge of the classroom, but now they'll show them.
Are you #$%%in' kiddin' me...?
written by Privatize the Profits! Socialize the Costs!, May 18, 2012 6:20
every child in America has access to high-quality pre-schools and great teachers (in part by recruiting top college students to careers in the classroom and paying them up to $150,000 a year),

$150,000 a year?--- Yeah, right... what a load of BS---!!!!

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Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.